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2019 Februaryof the Month

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Car and Driver: GM Invests $500 Million in Lyft to Create Network of Self-Driving Taxis

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-General Motors just made a sizable bet on the future of ride-sharing, to the tune of a half billion dollars.

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The automaker announced today that it’s investing $500 million in Lyft, the ride-sharing app with the cloying pink mustache logo, establishing “a long-term strategic alliance to create an integrated network of on-demand autonomous vehicles in the U.S.”

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As GM lays it out, the investment in Lyft will give the ride-sharing startup access to the automaker’s extensive research into autonomous-car technology. The newly-forged partnership also makes GM a “preferred provider of short-term use vehicles to Lyft drivers.”

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Lyft and GM did not give a time estimate for when they believe the autonomous network will go online. As part of the partnership, GM has secured a seat on Lyft’s board of directors.

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But it’s the long-term view that seems to be the hook for GM: The automaker and the startup both envision a future where the ride you hail from your smartphone app is completely self-driving. “We see the future of personal mobility as connected, seamless, and autonomous,” GM President Dan Ammann said in the press release. Lyft president and co-founder John Zimmer added, “Together we will build a better future by redefining traditional car ownership.”

The move makes sense for GM—partnering with Lyft gives the automaker access to new customers in the near term (via the new rental/lease program for Lyft drivers), and a built-in fleet customer in Lyft itself once autonomous vehicles become trustworthy enough to replace human Lyft drivers.

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In theory, it sounds similar to Ford’s new partnership with Google: A legacy automaker moving to secure a place at the table in a world with a shifting concept of mobility. In an interview with the New York Times, Lyft’s Zimmer said, “We strongly believe that autonomous-vehicle go-to-market strategy is through a network, not through individual car ownership.” It’s not surprising, then, that GM would work to secure a long-term customer in preparation for a future vision that circumvents individual car ownership. “We think there’s going to be more change in the world of mobility in the next five years than there has been in the last 50,” Ammann told NYT.